April 20, 2017

A Government of Laws, Not Son-in-Laws



Mainstream Washington critics of the Trump administration have been tempted to breathe a sigh of relief in recent weeks, with the apparent decline in status of alt-right-sympathizing nationalist ideologue Stephen Bannon and the ascendancy of Trump’s son-in-law, Jared Kushner. Bannon was removed from the National Security Council; Kushner’s portfolio has expanded to include (deep breath) reinventing government using techniques from the private sector, the Israel-Palestine conflict, America’s opioid epidemic, infrastructure, and health care for veterans.

Over the same period of time, the administration has abandoned campaign positions on a number of issues and shifted closer to Washington conventional wisdom. Most conspicuously, Trump won plaudits from mainstream Washington opinion for his (symbolic and largely ineffective) missile strike against a Syrian government airfield and his (mixed-message) tilt against the Syrian government in the Syrian civil war. Bellicose language on North Korea along with a rhetorical softening toward China, the abandonment of a campaign pledge to abolish the Export-Import Bank, and approval of Montenegro’s accession to NATO all suggest an administration that is moving closer to the traditional views of the Washington establishment.

Plus ça Change

As some smart commentators have pointed out, there is a lot less to these shifts than is suggested by a media corps perpetually ready to jump at any sign of a Trump pivot. (See Greg Sargent, Brian Beutler, and Dan Drezner.)

It’s nice that Trump was willing to learn from Chinese President Xi Jinping that handling North Korea is “complicated,” but not especially impressive.

It’s noteworthy to see Trump acknowledge at all that the Syrian regime is abusive and that its Russian patrons have interests that diverge from our own, but the swoon over strategy-free missile launches has assuredly taught the administration the worst of lessons about how to improve its public standing.

In the meantime, regardless of who’s up and who’s down in the West Wing, policy continues down the path of racism, ethnonationalism, and protectionism.

The draconian restrictions on migration from several majority-Muslim countries are held in check by temporary injunctions at the moment, but there’s been no indication that the administration will relent on defending them and trying to implement them. Conspicuously, comparisons of Bashar al-Assad to Hitler notwithstanding, there’s been no change on the exclusion of refugees from Syria.

Trump continues to rail against NAFTA. The rhetoric around the “Buy American and Hire American” executive order is pure Bannon: skilled legal immigrants who come to the US under H1-B visas join the list of scapegoats, and immigration restriction is explicitly joined to protectionism in a nationalist package.

Trump’s congratulatory call to Turkish Prime Minister Tayyip Erdogan for his suspect victory in a referendum that further undermines Turkish constitutionalism confirms Trump’s inclination to side with nationalist authoritarians abroad, regardless of any temporary strains in his relationship to Russia over Syria.

And Attorney General Jeff Sessions, in his own words an “admirer of Steve Bannon,”  is engaging in demagoguery on immigration and sanctuary jurisdictions, limiting oversight of abuses by local police departments, and ending efforts to rein in the junk science that often passes as forensic evidence in criminal trials. Sessions isn’t the same kind of big personality that Bannon is, and doesn’t attract attention as easily. But he’s the one who will do the most to deploy the armed and coercive force of the United States government against vulnerable minorities.

Nepotism Has No Place In A Liberal Democracy…

Even focusing on the West Wing alone, the ascendancy of Kushner is deeply troubling. Bannon certainly represents a threat to liberal, democratic, constitutional values. But so does Kushner: not because of his ideology, but because of who he is and why he is there.

Liberalism, democracy, constitutionalism, and the rule of law all in various ways describe an aspiration to governance by impersonal rules. We have procedures, norms, and laws before we know whom they will benefit in particular cases; when particular cases arise, the rules are applied in a consistent and neutral way.

A modern market economy also depends on consistency and neutrality—in contract and property disputes, for example—and introduces norms of impersonality of its own. The large and deep capital markets of modern stock markets rely on an impersonal and abstract kind of business ownership. In exchange for access to new capital, business founders subject themselves to the impersonal discipline of market forces in their control of their firms, and shareholders gain an impersonal and anonymous kind of fractional ownership. Indeed, the modern corporation itself is an instance of the same kind of thing. Whereas the traditional mercantilist corporation was a privilege granted by royal favor to some particular person, modern incorporation is available to anyone who fills out the correct form.

Such impersonal rules enable differentiated roles. My subordinate at work is my equal in the voting booth, a stranger to me in the pews because we belong to different religions, and a holder of authority over me in the condominium association of which he’s a member of the board. Status in one domain might correlate to status in others, but it’s not simply carried over from one to the next.

These are such foundational principles in societies like ours that it’s hard to even think about them as principles at all; or perhaps they’re part of what we mean by calling something a principle. When I defend, say, freedom of speech or a particular voting rule or some understanding of contract law, what everyone understands me to be doing is defending those as general abstract principles that apply impersonally. But an overall social order of general impersonal rules is a rare and recent accomplishment. What Douglass North, John Wallis, and Barry Weingast refer to as the “open access order,” in which such rules took priority over elite kinship ties and alliances, isn’t much more than two centuries old.

In much of the world it remains a fantasy. When everyone knows that everyone else acts nepotistically, when control of social institutions is just understood to mean “the ability to direct institutional resources towards one’s kin and group,” neither constitutional democracy nor the rule of law nor capitalist markets can really take hold.

…Even If It’s An Improvement Over Outright Fascism

During the 2016 campaign, some analysts asked whether Trump was more like former Italian prime minister Silvio Berlusconi or like former Italian dictator Benito Mussolini. (See political scientist Julia Lynch’s valuable discussion here.) In that comparison, Berlusconi obviously seems like the thing to hope for, in much the way that people take comfort from Kushner’s rise over Bannon: compared with fascism, what’s a little nepotism or corruption?

Fascism is worse, no question. But that doesn’t make “Berlusconi” an attractive outcome. I worry about taking the impersonal rules of the open-access order so much for granted that a little nepotism here and a little corruption there end up doing real damage to our institutions (as, Lynch notes, Berlusconi did to Italy’s). “Don’t run a government based on nepotism and personal familial enrichment” seem like principles too simple and obvious to be worth restating, but it’s a feature of the current crisis that even some very basic principles sometimes need to be restated.

Trump’s business background is unusually far from the world of the impersonal market. From real estate developer to reality TV character to serial licenser of his name, which, slapped onto often-shoddy products, was supposed to make them glamorous and gold-plated by association (Trump steaks, Trump vodka, Trump University), his has been a very personalistic business, a family-run conglomeration of entities that had little in common besides the belief that his name made them valuable. This is, of course, why he never seriously entertained putting his assets into a blind trust or liquidating them in order to avoid conflicts of interest, as all other recent presidents have done. Bill Gates could sell his shares of Microsoft at market value, or a trustee could do it on his behalf. But the Trump business only makes sense as the Trump business; dismembering it to avoid conflicts of interest and violations of the Emoluments Clause would mean that there wasn’t much left.

Even after only a few months, it’s hard not to let the treatment of the presidency as a branch of the family business fade into the background. It’s hard to sustain outrage at the fact that, upon Trump’s election, membership fees at his club and resort at Mar-A-Lago were doubled to $200,000 per year, that his weekly trips there that keep his commercial property in the news, that he is trying to rebrand it as the “winter White House,” that he can’t seem to stop promoting the property—describing the “most beautiful piece of chocolate cake you have ever seen” that he enjoyed with Xi while telling him about the attack on Syria. (When telling the story, Trump mistakenly referred to the country in question as “Iraq.” But he remembered the commercial for his business.) Kellyanne Conway was reprimanded for violating federal ethics rules when she used her official position to promote Ivanka Trump’s fashion line. But Trump does the equivalent for his own commercial interests, day after day, week after week, exploiting the ambiguities about the presidency’s status under relevant statutes to hold, absurdly, that “the president can’t have a conflict of interest.” This is banal, embarrassing stuff, not the high drama of military confrontations or court battles about constitutional rights. But it’s also a constant, steady erosion of the boundaries between political officeholding and personal or family enrichment.

The Eroding Boundary Between Public and Personal

Trump does not much distinguish between his personal finances and those of his businesses. In response to questions about his personal income taxes last year, his campaign falsely claimed that he had a fiduciary responsibility to his investors and employees to minimize his taxes. Boundaries and role differentiation have come no more naturally to him in office. (Last week he referred to the United States armed forces as “my military.”)

Trump’s family members, in their capacity as quasi-officials, introduce their own conflicts of interest: Kushner’s real-estate business, and Ivanka Trump’s international merchandising (dependent on branding and trademarks granted by foreign governments), each raise their own kinds of problems. Even setting that aside, hiring Ivanka and Jared for official positions required a novel reinterpretation of a decades-old anti-nepotism statute.

Nepotism creates more than one kind of problem in institutions. One is that those outside the family don’t get a fair chance to compete for the positions in question. If I give better grades or bigger raises or higher-status jobs to my family members, I’m wronging the other students, employees, applicants. This doesn’t really apply to the president’s personal advisers; positions like that are justifiably based on connections and personal trust. (This was the justification for the reinterpretation.) But the other is the damage done to independence of judgment and decision-making.

Over the course of the Bannon-Kushner struggle, many, reportedly including Kushner himself, have noted that he “can’t be fired.” But even those of us cheered at a little loss in status for Bannon can’t be too comfortable with the idea that a 36-year-old “real-estate guy” can be in charge of half a dozen major government portfolios and can’t be removed from them because the only person with firing authority trusts family over expertise and experience.

Nepotism In The Long-run

People who run large organizations reasonably seek to surround themselves with people they trust—but a crucial part of their job is adjudicating among them and holding them accountable. When, inevitably, Kushner comes into conflict with government officials who have actual knowledge of the things he’s now supposed to fix—Middle-East hands in the State Department, for example—do we think Trump will listen dispassionately to both sides?

The success of open-access orders has come in part because impersonal rules improve decision making. Impersonal capital markets do a better job than the king’s advisors, who are inclined to subsidize their friends and family. Democratic elections (for all their flaws) choose better rulers than the sheer hereditary chance of monarchies. Courts make better decisions when judges can neither be the relatives of, nor take bribes from, the parties before the bench. And bureaucratic institutions with good role differentiation—for all their flaws—allow for advice and ideas to be evaluated at least partly independently of who it is that offers them. Violating these rules and norms not only corrodes trust in the institutions’ fairness; it also undermines their effectiveness.

Nepotism isn’t bribery, but it is a kind of corruption nonetheless, one that weakens institutions that depend on impartiality. An administration that seems all too ready to treat public office as a private interest isn’t going to be improved by running that private interest as a family business.

*Yes, I know that it’s “sons-in-law.”


Jacob T. Levy is Tomlinson Professor of Political Theory and Director of the Yan P. Lin Centre for the Study of Freedom and Global Orders in the Ancient and Modern Worlds at McGill University; author of Rationalism, Pluralism, and Freedom; a blogger at Bleeding Heart Libertarians; and a Niskanen Center Senior Fellow and Advisory Board Member.